How To Set A Fee In Private Practice
Setting a fee can be one of the trickiest and scariest parts of opening a private practice.
Charge too little initially and you might regret it later if your expenses are higher than profit.
Charge too much and you might have difficulty getting new consistent clients.
Many previous therapists I’ve worked with tell me similar things:
I should just charge what others are charging, right?
I just graduated, who am I to charge over $100?
It feels weird to think about money. I went to school to help people, not get rich.
I’m not really comfortable talking about money with my clients.
I don’t feel like I should be charging over $100, so I just offer a reduced fee to every client I consult with, even before they ask.
How To Set a Fee (Some Options)
Conduct Market Research
Look on Psychology Today and compare prices based on education, zip code, specialities
Consider your:
Education
Experience
Licensure level
Ask Colleagues & Supervisors
Ask them for their advice
Work Backward & Set a Fee Based On How Much Income You’d Like To Make & Consider:
Unpaid time off you need/want annually
Taxes you will pay (federal, state, city)
Expenses (e.g. EHR, credit card processing fees, computer, supplies, office space)
Money needed for professional development (e.g. training, supervision, consultation, workshops, conferences)
How many clients you want/need to see weekly
Client cancellations and no-shows
Market Rates In Seattle
$140-$160 for licensed therapists for a therapy hour
$90-$130 for unlicensed therapists for a therapy hour
$25-$100 for student interns completing practicums for a therapy hour
I’ve seen ranges from $60-$350 (yes, $350) for a therapy hour
Questions To Ask Yourself
How much money do I need to make to break even?
How much debt and loans need to be paid off monthly?
How much does my health insurance cost monthly?
How much time off/sick time do I need to account for realistically?
How much money do I want to make so I can be fully present for my clients without panicking and worried about meeting my basic needs?
What are my forms of self care? How much do these things cost (if they aren’t free)?
How much of my fee am I really making after accounting for expenses, taxes, insurance?
Cognitive Flexibility
As therapists, we work with clients to help them identify more flexible and helpful ways of thinking from more adaptive ways of being due to their methods of survival.
Instead of labeling thoughts as bad or good, it would be more effective for us to consider:
What sort of business works for us and our unique lifestyles and circumstances
How much money we need to make to sustain a long term career in mental health
Brainstorm other ways of giving back in addition (or besides) offering a reduced fee
Exploring our own relationship to money, security, and safety
Exploring our own relationship to scarcity, anxiety, fear, and shame
Our own intersectional identities (e.g. class, race, ability, gender, sexuality, migration) and how this shapes our relationship to money
What we will work for one therapist will not work for another. And that’s okay.
Fee Setting Tips
You can always increase your fee later on if you feel uncomfortable with a higher rate now
You can always lower your fee later on as well
Consider Social Work Code of Ethics
When setting fees, social workers should ensure that the fees are fair, reasonable, and commensurate with the services performed. Consideration should be given to clients’ ability to pay.
Read more here
Consider the system of productivity and capitalism we live under and within
Consider how much is enough for you to live in our society in a sustainable way (rather exploitative way)
Consider the next generations after us and what we want to leave them with (not just money, but the natural environment/earth)
Consider ways of giving back, in addition to, offering a reduced fee/sliding scale. Once you have enough financially, this will free you up to give back in other ways outside of being a therapist including:
Mentoring early career professionals
Low cost/reduced fee supervision for early career professionals
Offering free resources through a blog
Pay what you can or tiered pricing for group therapy
Organizing wellness/health retreats/conferences/workshops
Pro bono therapy
Pro bono lectures/speaking engagements
Use free resources out there like:
Consider complexity (both and, not either-or)
You can make a good salary AND charge a good fee.
It’s not about extremes, but something in the middle.
Fees do not reflect competence
Great therapists can charge $90. Great therapists can also charge $200.
Not so great therapists can charge $200. Not so great therapists can charge $90.
A fee is just a fee. In marketing, a higher fee can sometimes represent a higher value or service, but that isn’t true. That’s just marketing.
Therapeutic fit is more of a predictor of therapeutic success than a fee
Personalize it
Try not to compare yourself with other therapists.
Consider your own personal life and factors. They have other life circumstances, identities, and experiences.
We don’t know why therapist #1 is charging $100 a session while therapist #2 is charging $150 and therapist #3 is charging $200. We can only assume.
Think long term
If you plan on being a therapist in private practice long term, consider what you need financially to feel secure
If you feel more secure, your client will receive a more effective version of you in session
Work on your money issues/mindset
If you grew up poor with very little, examine what it means to make more, have enough, and be enough such as guilt and shame.
If you grew up with more financial privilege and security, examine what it means to work with others who might not have as much, how much you actually need to live, and your own areas of power and privilege in terms of guilt and shame.
Words to reflect and explore:
Financial independence
Financial integrity
Financial security